Reference no: EM131264108

Discuss the most common forms of consumer sales promotion. Consumer forms of sales promotion include coupons and rebates, premiums, loyalty marketing programs, contests and sweepstakes, sampling, and point-of-purchase displays. Coupons are certificates entitling consumers to an immediate price reduction when they purchase a product or service. Coupons are a particularly good way to encourage product trial and brand switching. Similar to coupons, rebates provide purchasers with a price reduction, although it is not immediate.

To receive a rebate, consumers generally must mail in a rebate form with a proof of purchase. Premiums offer an extra item or incentive to the consumer for buying a product or service. Premiums reinforce the consumer's purchase decision, increase consumption, and persuade nonusers to switch brands. Rewarding loyal customers is the basis of loyalty marketing programs. Loyalty programs are extremely effective at building long-term, mutually beneficial relationships between a company and its key customers. Contests and sweepstakes are generally designed to create interest, often to encourage brand switching. Because consumers perceive risk in trying new products, sampling is an effective method for gaining new customers.

Finally, point-of-purchase displays set up at the retailer's location build traffic, advertise the product, and induce impulse buying.

1. Discuss how different forms of sales promotion can erode or build brand loyalty. If a company's objective is to enhance customer loyalty to its products, what sales promotion techniques will be most appropriate?

2. What forms of consumer sales promotion might induce impulse purchases? What forms of sales promotion are more effective at persuading consumers to switch brands?

3. Consider the different consumer sales promotion tools. Give an example of how each type of tool has influenced you to purchase-or purchase more of-a product or service.

4. Not everyone thinks supermarket shopper cards are a bargain. Go to www.nocards.org and read several pages. Is the information on the site compelling? What do you think of shopper cards? You may want to use.